PSEi rises as inflation likely eased further in Jan.

STOCKS climbed for a second straight session on Monday on expectations that Philippine headline inflation slowed further in January.

The Philippine Stock Exchange index (PSEi) went up by 20.97 points or 0.31% to finish at 6,728.22 on Monday, while the broader all shares index rose by 8.32 points or 0.23% to 3,525.14.

“The local bourse sustained its rally, gaining by 20.97 points to 6,728.22 ahead of the release of January inflation rate. Investors expect that the January inflation rate would slow down compared to the prior month as well as to the same month in 2023, which boosted the sentiment,” Philstocks Financial, Inc. Research Analyst Claire T. Alviar said in a Viber message.

The Philippine Statistics Authority will release January consumer price index (CPI) data on Tuesday.

A BusinessWorld poll of 16 analysts conducted last week yielded a median estimate of 3.1% for January CPI, settling within the 2.8-3.6% forecast of the Bangko Sentral ng Pilipinas (BSP).

If realized, this would mark the second straight month that inflation was within the BSP’s 2-4% annual target. It will also be below the 3.9% print in December.

At 3.1%, January inflation would be the slowest since the 3% pace in February 2022.

“The PSEi also gained after the continued gains in the US stock markets… after stronger-than-expected US jobs data that reduced the odds of Federal Reserve rate cuts for 2024,” Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said in a Viber message.

US stocks ended sharply higher on Friday and the S&P 500 registered an all-time closing high as strong earnings and a blowout January employment report boosted confidence in the economy, even while lowering the likelihood that the US Federal Reserve will cut interest rates any time soon, Reuters reported.

The S&P 500 climbed 1.07% to end the session at 4,958.61 points. The Nasdaq gained 1.74% to 15,628.95 points, while Dow Jones Industrial Average rose 0.35% to 38,654.42 points.

The US added 353,000 jobs in January, blasting past analysts’ estimates, while wage growth unexpectedly heated up, the Labor department reported.

At home, sectoral indices were split. Services rose by 22.01 points or 1.34% to 1,656.91; industrials went up by 69.25 points or 0.76% to 9,112.03; and property climbed by 15.49 points or 0.53% to 2,895.31.

On the other hand, mining and oil fell by 115.92 points or 1.25% to 9,111.58; holding firms retreated by 24.56 points or 0.38% to 6,340.21; and financials dropped by 1.24 points or 0.06% to 1,937.30.

Value turnover dropped to P5.26 billion on Monday with 425.46 million issues changing hands from the P5.98 billion with 448.43 million shares traded the previous day.

Decliners outnumbered advancers, 101 versus 81, while 52 names ended unchanged.

Net foreign buying rose to P127.83 million on Monday from P35.78 million on Friday. —

Meanwhile, operating expenses stood at P6.5 billion last year.

Its cost-to-income ratio went down to 36.3% from 37.6%.

Deposits with the bank stood at P292 billion in 2023, with low-cost current and savings account or CASA deposits making up bulk of the total, AUB said.

The bank’s assets grew by 4% year on year to P355.1 billion in 2023.

Equity also increased by 23% to P49.1 billion last year. The bank’s common equity Tier 1 ratio was at 16.88%, while its capital adequacy ratio stood at 17.49%, well above the regulatory requirements.

AUB’s shares rose by 50 centavos or 1.49% to close at P34 apiece on Monday. —